Local Obesity Prevalence and Corporate Policies

Forthcoming, Quarterly Journal of Finance, 2018

49 Pages Posted: 4 Sep 2016 Last revised: 31 Jan 2018

See all articles by Anup Agrawal

Anup Agrawal

University of Alabama - Culverhouse College of Commerce & Business Administration

Yuree Lim

Texas Woman’s University

Date Written: January 2, 2018

Abstract

Consistent with prior findings that obese individuals tend to be more risk-averse and myopic, we find that firms located in areas with higher obesity rates invest less, grow more slowly, are less profitable, and have higher stock volatility. We mitigate identification concerns by using an instrumental variables approach, testing for local managers and local shareholders as channels for these effects, and ruling out several alternative explanations, thereby favoring a causal interpretation of our results. Finally, both genetic and environmental factors appear to contribute to these effects. Our findings suggest that physical characteristics of the local population also affect the policies of local firms.

Keywords: Obesity, Corporate policies, Risk-taking, Myopia

JEL Classification: G02, G30, I12

Suggested Citation

Agrawal, Anup and Lim, Yuree, Local Obesity Prevalence and Corporate Policies (January 2, 2018). Forthcoming, Quarterly Journal of Finance, 2018, Available at SSRN: https://ssrn.com/abstract=2833398 or http://dx.doi.org/10.2139/ssrn.2833398

Anup Agrawal (Contact Author)

University of Alabama - Culverhouse College of Commerce & Business Administration ( email )

Culverhouse College of Business
EFLS, Box 870224
Tuscaloosa, AL 35487-0224
United States
205-348-8970 (Phone)
205-348-0590 (Fax)

HOME PAGE: http://aagrawal.people.ua.edu/

Yuree Lim

Texas Woman’s University ( email )

TX
United States

Do you have negative results from your research you’d like to share?

Paper statistics

Downloads
128
Abstract Views
1,210
Rank
400,044
PlumX Metrics